THE GREAT BETRAYAL: How American Sovereignty and Social Justice are being Sacrificed
to the Gods of the Global Economy

By Patrick J. Buchanan

Little, Brown and Company 384 pp.

It is no surprise that Patrick Buchanan has chosen to begin his next campaign for President with a
book that blames free trade for all of America's problems. What is surprising is how ordinary,
even restrained The Great Betrayal is. For the most part it is no worse than - indeed is largely
based on - the sort of thing you can read all the time in The Atlantic, The National Interest, and
other seemingly respectable journals. If Buchanan is prone to logical whoppers, garbled statistics,
and warped history, he is no different from many people who imagine themselves well informed
- although he is unusual in regarding the rising number of working women as a key barometer of
America's decline, and perhaps also in concluding that imports, by driving down wages and thus
forcing women into the labor force, have directly caused "Broken homes ... delinquency,
vandalism, crime" [286].

Let's get the economics over with quickly. Buchanan believes that thanks to free trade America
is squandering its capital abroad; that thanks to imports, bank loans, foreign aid, and U.S defense
expenditures overseas "Too much of the seed corn of the U.S. economy is now being exported all
over the world" [315]. Never mind the details (though he gets many of them wrong): underlying
this whole world view is an almost ridiculous conceptual confusion. Apparently neither
Buchanan nor his fairly extensive brains trust have noticed that the United States is a net
importer, not exporter, of capital - that we are able to run a trade deficit precisely because
foreigners are investing more in the United States than we are investing abroad. (This is not
abstract theory: it is a matter of unarguable arithmetic). Once you realize that capital is flowing
into the United States, not out of it, just about everything else in Buchanan's argument falls apart
- unless you somehow think that when an American company builds a factory in Mexico, that
counts, but when a German company builds a factory here it doesn't.

Anyway, it is clear that Buchanan has little patience for close economic analysis: his chapters on
the subject have a dutiful feel, and one suspects that if he wrote them at all he did little more than
transcribe extensive notes prepared by other people. What Buchanan loves - and I think this is
genuine - is political history. Most of the book is, in fact, not about modern economics but about
nineteenth-century political debates over U.S. trade policy. It has often been said that Buchanan
wants to turn the clock back; this book certainly reveals him as a man who loves our past, with a
passion that verges on the - gulp! - scholarly.

But he does not love all of America's past. In fact, reading the book I found myself wondering
where a rather large chunk of our history went - namely, the great postwar boom. His book skips
without a pause from the Trade Agreements Act of 1934, which he correctly identifies as the
beginning of our long move toward free trade, to the economic difficulties of the later 1970s. Yet
his own chart of U.S. tariff history [p. 265] shows that the great bulk of America's move from
protectionism to free trade took place between 1934 and 1960, even though he chooses
inexplicably to consider the relatively small tariff reductions since 1967 as defining the "free
trade era". And surely the prolonged era of unprecedented growth that took place as tariffs
declined should at the very least count as evidence that liberalizing trade does not always produce
evil effects. Indeed, most people who bemoan the current state of the nation look to the economy
of the 50s and 60s as exemplifying the kind of broadly spread prosperity we would like to
recapture.

Yet Buchanan prefers to pretend that the whole period never happened. What he wants to restore,
instead, is the pre-New Deal American economy - an economy that achieved impressive growth
(although he may have forgotten that this growth was fueled in large part by massive
immigration!), but also produced widespread misery and vast inequality. Perhaps he loves the
distant past too much to find any virtue in times within living memory; or perhaps he dislikes the
welfare state too much to acknowledge that Franklin Roosevelt's legacy can have had any
positive side. Or perhaps, just perhaps, Buchanan is less populist than he claims to be: he may
put "social justice" in his subtitle, but he actually seems to long for the good old days when the
gap between rich and poor was even wider than it is today.

Paul Krugman teaches economics at MIT; his most recent book is The Accidental Theorist (and
other Dispatches from the Dismal Science).